Recordkeeping alters economic history by promoting reciprocity

Sudipta Basu, John Dickhaut, Gary Hecht, Kristy Towry, Gregory Waymire

Research output: Contribution to journalArticlepeer-review

Abstract

We experimentally demonstrate a causal link between recordkeeping and reciprocal exchange. Recordkeeping improves memory of past interactions in a complex exchange environment, which promotes reputation formation and decision coordination. Economies with recordkeeping exhibit a beneficially altered economic history where the risks of exchanging with strangers are substantially lessened. Our findings are consistent with prior assertions that complex and extensive reciprocity requires sophisticated memory to store information on past transactions. We offer insights on this research by scientifically demonstrating that reciprocity can be facilitated by information storage external to the brain. This is consistent with the archaeological record, which suggests that prehistoric transaction records and the invention of writing for recordkeeping were linked to increased complexity in human interaction.

Original languageEnglish (US)
Pages (from-to)1009-1014
Number of pages6
JournalProceedings of the National Academy of Sciences of the United States of America
Volume106
Issue number4
DOIs
StatePublished - Jan 27 2009
Externally publishedYes

Keywords

  • Accounting
  • Economic institutions
  • Image score
  • Memory
  • Trust

ASJC Scopus subject areas

  • General

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